Thursday, December 30, 2010

There are Some Unique Elements which Determine Whether a Marketing Campaign or a Product Launch Succeeds or Crashes. Call it The 6 ms Approach of Marketing!

“You don’t need my investigative skills, dear Dr. Watson,” said Sherlock Holmes, “to realise that a marketing campaign is working when a simple spinning top or a two bit rubber band goes out of stock even at a fancy price of Rs.200-400 or Rs.90.” Alright, so we made it up. The ace detective never said it. Indubitably, however, no one can refute the truthfulness of the concocted statement. Beyblade is nothing but a branded spinning top, repackaged and coated with some shiny stuff, worth Rs.5. Promoted directly and indirectly through websites and TV shows as Storm Pegasus, Tornado Wing, or Seggitario, it makes children act like extortion dons coercing and reigning over their parents, who surrender and buy in addition an ugly plastic contraption called ‘Arena’, the battleground for these branded warriors.

Wipro had launched an offering called Pace, when the recession was on in the US; it addressed issues like capital saving and efficiency for user clients. But since the last six months, the customers are asking for revenue enhancers – they are no longer looking at an offshore version. So Wipro proposes to launch a new campaign in February 2011 that will talk about improvement in product cycle time and not just about costs. Customers now are looking at the speed at which solutions can be delivered, so that ROI can be realised soon, not 18 months later. This sure warrants a change in product offering and marketing communication.

MARKETING IS CUSTOMER
ORIENTED: THAT’S AN OLD HAT
Okay, but are you aware as to who is your customer? Actually the marketer-customer relationship has evolved through three stages and is now in the fourth one. And in a heterogeneous market like India, all the four versions may coexist. In the initial phase, there existed pre-determined groups of buyers who were certain to buy. Individual differences and preferences counted for nothing. Products were created without much feedback from the users who were targeted through one way communication. In stage 2, a customer became an individual statistic but without much of a unique identity. He was spoken with, feedback obtained, and changes were incorporated for redesigning the product. In the next stage, a customer is identified as a unique entity. The products are reconfigured based on deep understanding of his needs. The communication is on a one-to-one basis. Finally, in stage 4, the customer is being treated as part of an enhanced network; he co-creates and extracts business value.

EXCELLENT MARKETING CAMPAIGNS REST ON SIX Ms.
A marketer needs to follow the six Ms approach in order to make his marketing campaign future proof.

1.Precocious child or sweet sixteen? The marketer needs to define the target market in terms of demographic, psychographic, geographic, behavioural, and mediagraphic profiles. But, also realise that demographic variables fail to differentiate consumer behaviour. For example, 30-40% of consumers of premium brands are not necessarily SEC A. They could very well belong to SEC B or C. Partly, this is because over the last two decades, value drivers have changed from mere value for money and good quality to greater choices, service, and experience at retail level. When Hero Honda introduced the Passion, it had youth in the age bracket 18-30 years in mind who stayed in urban/semi-urban area and belonged to SEC A or B. More importantly, the customer was described as enthusiastic, who was considering a bike as an extension of his personality, was a style and looks conscious guy, someone who wanted something decent but price competitive.

2. Merchandise, the second M: The marketer must make it clear what is on offer, in terms of attributes, benefits, and values. Titan learnt two important lessons. One, watches are no more a time-keeping device but an everyday accessory and a style statement for the customer. So it positioned the brand accordingly. Two, one needs to lead the market with emotional innovation and keep repositioning the brand accordingly. So the latest catchline is ‘Be More’. Airtel, the number one brand in mobile communication, decided to make life simple for consumers by offering them simple and transparent services, communication and tariff plans and bills, since this is what the customer wanted.

3.Motive, the third M: An excellent campaign is based on deciphering the real reason behind the target prospect considering the product. So why did Kellogg fail in India? Because it attacked traditional belief that Indian breakfast was healthy; because in India pan-India breakfast item is a utopian concept, rather regional food preferences prevail This is because while cereals are light on tummy, Indians prefer heavy breakfast. Indians prefer spicy and savoury breakfast, not sweet. In brief, customers were not driven enough to buy. A Reebok failed initially because, in a nascent market, it talked about ‘marvel of engineering’. Focus on the sizzle, not the steak.

4.Message, the fourth M: It is the excellence of marketing campaign that made Dabur Chyawanprash rule over more than half the market. In one such effort, the positioning became ‘Banaaye andar se strong’ (makes you strong internally). Initially, when Dabur’s communication agency had focused on the rational appeal, the company had rejected it. Finally, the message with an emotional appeal was chosen. We also have to decide on the right choice of source (Toyota Etios) and package the message appropriately so that it stands out in a clutter (Jaago Rey campaign by Tata Tea). So an effective message is all about right positioning, brand image, and communication.

5.Media, the fifth M: Hrithik Roshan, Priyanka Chopra, SRK, Aamir, Amitabh and a whole lot of other film stars are on social media (Twitter, Facebook, et al), to keep in touch with their fans, take their feedback, and update them. This helps them strengthen their bond with their followers. A marketer has to decide whether to use a personal communication channel (Salman Khan selling tickets at Delite Cinema in Delhi) or non-personal (mass media, ambience/atmosphere, events, et al) one. The singular objective is to get, and stay, connected with target customer.

6.Measurment, the sixth M: It was only after ‘Bheetari Shakti Ka Vikas’ line failed to work, that Dabur decided to change it to ‘Banaaye Andar Se Strong’. Since curative positioning made the customers treat Dabur Chyawanprash as a medicinal product, the positioning was changed to preventive, thus placing it in a broader ‘desi’ tonic category. In determining the effectiveness of a campaign one should be clear about what is to be measured (Sales or communication effects?) and appropriate tools of measurement (Focus groups, sales waves et al). The feedback obtained thereby will give an idea whether to continue with the campaign (Cadbury retaining its positioning of celebrations with Cadbury) or modify it (Pizza Hut) or drop it (Ericsson, when people mistook the mobile brand being designed only for ladies).

It is on the strength of excellent and effective marketing campaigns that Maggi adorns the kitchen shelves of virtually all urban households, Cadbury is accepted as suitable ‘Meetha’ option for all occasions, and Lux makes all ladies aspire to look like their favourite film stars.

Thursday, December 16, 2010

You will come across Uncountable Lessons of Failure in the World of Mega-Brands and Giant Citadels. But there are Some Names, Which have Managed to Bounce Back. Cheers to Such Goliaths!

HOW DOES THE GODZILLA GET THE SWAGGER BACK?
Vicco Turmeric and Vicco Vajradanti once were marquee ayurvedic skincare and oral care brands. But over time, Vicco failed to keep pace with consumer trends. It was a successful brand promising beauty care in a tube. Even today, the brand enjoys high recall and strong equity. But the brand failed to contemporise; it has failed to capture the new customer. It has thus ceded ground to newer aggressive players in the overall Rs.3500 crore skincare products market, where ayurvedic creams account for close to 15% market share.

But we don’t intend talking about brands which sign their own death warrants. Instead, we would like to document case histories of Goliaths who are trying to beat back bullies on their own turf. To be sure, competition rears its head with unfailing regularity across all segments of the industry. Improved customer sentiments, robust volume growth, a 5-10% price rise, grammage reduction in select biscuits, launches of innovative products and premium biscuits at lower prices, all this and more have meant improved profit margins for Britannia Industries. Yet, analysts are not too optimistic about the company’s prospects, as competition turns intense from foreign (United Biscuits and Kraft) and domestic (ITC, Parle, and Glaxo) players, in addition to the regional brands. Pepsico enjoys 50% plus market share in snacks, but Parle says it will slice 20% of market for itself before the current financial year is done. Who is scared of the might of the multinational muscles?

So the Goliaths, which are caught enjoying a siesta, are successfully challenged by the Davids of the marketing world. A short nap on the steering wheel can prove to be extremely dangerous. The question, however, is: can one still steer oneself to safety? Apparently yes. There are many brands who are trying to reclaim the lost script.

T FOR TEA, T FOR TATA
The branded tea market in India is worth Rs.7500 crore. Yet, though it is a popular beverage in India, tea is losing its popularity amongst youngsters. It is not considered a ‘cool’ beverage, which coffee is supposed to be. To make matters worse, in a recent survey, 77% respondents believed that tea was an unhealthy drink that caused acidity and nausea. Enough cause for worry for Hindustan Unilever Limited.

Then came in the spoilsport Tata Beverages and dethroned HUL from the #1 position in November 2009. The high voltage campaign ‘Jaago Re’ helped Tata increase its market share. Besides, it expanded into new geographies, undertook new launches, took rural initiative, and decided to have a sharper focus on local brands. The company’s core strategy is to look at the large loose tea market and the local brands. It paid the company rich dividends for some time.

HUL decided to fight back. It was successful and beat back Tata in September 2010 with a value share of 22.8% (Tata: 20.2%) and volume share of 18.4% (Tata: 18.3%). HUL played across the consumer pyramid, offering Brooke Bond Sehatmand at the bottom of the pyramid, and Taj Mahal tea bags and Lipton Green Tea to the top of the stack. Besides, it tailored its tea offerings in every state using micro marketing principles. Sehatmand, for example, became Arogya in the South. HUL also revived the core brand Brooke Band Label, highlighting its health benefits. The gambit, for now, has paid off.

THE STUMBLING STAR
The general entertainment channel (GEC) Colors, was a late entrant. So it decided to follow the disruptive tactic of doing the unexpected. The channel pursued two Ds: disruptive programming and differentiation, thereby successfully cutting through the clutter. It began by offering a combo of Khatron Ke Khiladi (to create enough buzz), Balika Vadhu (to cater to the ‘New’ Woman), and Jai Sri Krishna (as a family soap). Nine months into telecast, and it unseated Star Plus from the numero uno position. It won and then retained the top slot in viewership ratings for a good 22 weeks. That was a wake-up call for Star Plus.

Star Plus decided to reinvent itself. It decided to keep pace with the new age Indian woman by continuing with fictional narratives, even if the rival channels had lined up a host of big budget reality. The women characters now depict inner strength enabling them to make intelligent choices for the betterment of their people. Besides, the channel constantly reviews its shows. If a show fails to deliver or has nothing new to offer in its storyline, then it is replaced. Star Plus has even managed to create new time slots at 11pm and 11.30pm. True to its new tagline (Rishta Wahi, Soch Nayi) the channel is offering its viewers a fresh perspective on life and relationships. All this has not only led to conscious repositioning, but also 15-18 of its shows always finding listing in the top 20 slots. The strategy has certainly paid off. The channel is targeting the weekly 400 Gross Rating Points (GRPs; current figure being 340-370), which, if it happens, should mean garnering Rs.1000 crore in ad-revenues. That is nearly 12% out of the total Rs.9,000 crore TV advertising on 500 plus channels!

MERCEDES GIVES RIGHT OF WAY TO THE BEAMER
According to E&Y, India will soon become the fastest growing automobile market globally; currently it occupies the number 2 position, after China. Little wonder then that five marquee names – Chrysler, Kia, Peugeot, Triumph, and Scania – are finalising their entry strategies. In this market, Mercedes has usually enjoyed a position of prominence when it comes to luxury cars. But compatriot competitors have started nibbling away the monopoly share of the company. When BMW, its immediate rival, arrived in India, it targeted the right gaps where Mercedes was more or less not focusing. With the increasing number of C Class 4 wheels rolling on the roads, the aura of owning a Mercedes for the average customer was on the wane; instead it looked swankier to own a ‘Beamer’. Although Mercedes still sells more UVs today (274 in January-October 2011, as compared to BMW’s 256 in the same period, as per SIAM), and is still the #1 in the A4 (Executive Class) segment (1,458 versus BMW’s 1,372 in the same period), and the A6 (Luxury) segment (339 versus BMW’s 307), it’s time for Mercedes to become aggressive and innovative if it has to remain ahead of BMW.

So, the brand has now decided to follow high volume, moderate margin strategy, as against the earlier high margin, low volume strategy. To achieve this, it has made 3 major changes. It has replaced all its earlier models with newer, feature rich, and technologically superior versions but with lower or same price tags. It has launched 22 models since January 2010, quite a contrast to the 25 models it introduced during 1996-2009. Then, it has decided to redesign all its showrooms, which now would have play area for children, and Manish Arora collections for womenfolk. Plus, it is launching its financial services arm and its pre-owned car outlets. Two, the company will have a tech focus. It has installed in the C and E class models, the latest C200 CGI Blue Efficiency engine which, due to its greater fuel efficiency, would appeal to Indian market even more.

SO HOW DO GOLIATHS REFUSE TO GET BULLIED?
The first step to solving a problem is to accept the problem – and the first step towards refusing to get bullied is to accept that there is a danger of that in the first place. As simple as that!

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